Ken Weckstein authored the article, "Payment of Fixed Fee Under CPFF Contracts," which was published by Bloomberg Federal Contracts Report. The article discusses the Federal Acquisition Regulation definitions of the two kinds of cost-plus fixed fee (CPFF) contracts and the difficulties that can arise in applying these basic principles, citing Teledyne as an example.
From the Article
"In Teledyne, there were lots of disagreements over basic facts. Significantly, the parties could not even agree on which form of CPFF contract was involved. Apparently, the Teledyne contract did not identify which form of CPFF contract or which FAR clause controlled the fixed fee determination. Moreover, the contract had the hallmarks of both forms of CPFF contracts. The ASBCA noted that the contract appears to be consistent with the term form contract because the contract stated a ‘‘specified level of effort for a stated’’ period of time that is characteristic of a contract under FAR 16.306(d)(2). But the parties also agreed in a contract modification that Teledyne would ‘‘produce 360 armor plates by the specified delivery date.’’ That requirement was noted to be consistent with the preferred completion form CPFF contract under FAR 16.306(d)(1). Obviously, on this record, the ASBCA denied the Army’s motion for summary judgment."